You’ve probably read or heard the word ‘Bitcoin’ more times than you can count over the past year. This ‘cryptocurrency’ is making waves and dominating the headlines because of its use of blockchain technology and its recent boom in value.

But what is a blockchain exactly? According to the authors of Blockchain Revolution, “The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.”

In other words, every time a ‘block’ or transaction is added to the ledger, it becomes a part of the permanent, universal database. Investopedia explains, “The blockchain was designed so these transactions are immutable, meaning they cannot be deleted. The blocks are added through cryptography, ensuring that they remain meddle-proof: The data can be distributed, but not copied.”

The technology was originally invented to handle accounting needs for Bitcoin, but it is already spawning new uses. Banks and major stock exchanges were some of the first entities to recognize the potential of blockchain technology, which is also sometimes referred to as distributed ledger technology (DLT). Nasdaq has been experimenting with DLT since 2015. A writer for the Nasdaq website explains that utilization of blockchain has “the potential to enable stock exchanges to significantly reduce the cost, complexity, and increase the speed of trading and settlement processes in a secure manner.”

So what does this mean for board members all over the globe? It means that the blockchain could revolutionize some industries and completely change the face of others. Inevitably, it will also produce new risks for companies. David Yermack, Professor of Finance at the NYU Stern School of Business, predicts several ways that blockchain could affect the landscape of corporate governance:

“Using blockchains to record stock ownership could solve many longstanding problems related to companies’ inability to keep accurate and timely records of who owns their shares.”

Blockchain could make stock buying/trading much more affordable as well as more transparent. For activists, this could mean lower-cost acquisitions of shares and less secrecy around the process in general.

“Corporate voting could become more accurate, and strategies such as ‘empty voting’ that are designed to separate voting rights from other aspects of share ownership could become more difficult to execute secretly.”

Basic corporate accounting could be completely transformed.

And finally, “Any and all of these changes could dramatically affect the balance of power between directors, managers, and shareholders.”